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Nograles rejects DOE rejoinder for anomalous IEMOP deal: The deal is against public interest

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By JOHN CARLO M. CAHINHINAN

House committee on energy vice chair Jericho Nograles maintained allowing a company with only P7,000 paid up capital to operate wholesale electricity spot market is against the EPIRA Law.

Nograles, representative of PBA Party-list, made the remarks after Department of Energy (DOE) justified allowing the Independent Electricity Market Operator of the Philippines Inc. (IEMOP) to corner the contract to manage the Wholesale Electricity Spot Market (WESM).

The energy department, in a briefer, maintained that there is nothing wrong with the operating agreement entered into by the Philippine Electricity Market Corporation (PEMC) and IEMOP because this was provided for under the EPIRA Law.

It also claimed that competitive bidding was not required under the EPIRA law.

But Nograles insisted that Rule 9, Section 6(a) of the Implementing Rules and Regulations of Republic Act no. 9136, otherwise known as the EPIRA Law provides that the Independent Market Operator must be “financially and technically capable, with proven experience and the expertise of not less than two years as a leading independent market operator of a similar or larger size electricity market.”

Nograles can’t hide his disbelief that a supposed small time company with only P7,000 paid up capital like IEMOP is actually running in the wholesale electricity spot market.

“The deal is against public interest and runs afoul with the requirement set by the Electric Power Industry Reform Act of 2001,” said Nograles.

Nograles stressed that with only P7,000 initial contributions, IEMOP “is not technically capable.”

“You cannot even purchase a brand new computer set, much more the millions of pesos needed to purchase and run an IT system for the Wholesale Electricity Spot Market,” said Nograles.

He noted that IEMOP has no proven experience and expertise of not less than two years as a market operator.

Based on the documents obtained by the lawmaker, IEMOP was incorporated only on May 15, 2018 and signed the market operations agreement on 19 September 2018 or after four (4) months of existence.

The EPIRA Law requires that the market operator, and not simply the employees, “has the minimum two-years experience as a leading independent market operator.”

Nograles stressed that necessity to conduct congressional probe over the matter since for every kilowatt hour that customers pay for their electricity, P0.50 are automatically collected IEMOP

“This is a highly regulated industry that has deep repercussions on the pockets of the people. Congress has to protect everyone. We have a questionable deal that needs a lot of explaining to the people and to Congress as well,” he said.

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